Mayor fears policy backed by Labour leader to make wealthy pay more could drive rich people out of the capital
Source - Daily Telegraph 26/11/21
A wealth tax could unfairly hit people who are "equity rich, but cash poor" and lead to a "flight" of high net worth individuals out of the UK, Sadiq Khan has said.
The Labour Mayor of London also warned Boris Johnson, the Prime Minister, that his plans to "level up" the country could not happen at "the expense" of London and the South East.
Mr Khan added that he wanted to see more statues of women, black and disabled people in London to reflect the multicultural nature of the UK.
Senior Labour figures are increasingly talking about a new tax on assets, or wealth tax, as a means to force the rich to pay more to fund public services.
Sir Keir Starmer, Labour's leader, said in September he would back "a wealth tax, in the broadest sense of the word" on people's "properties, dividends, stocks, shares" to fund social care.
However, speaking on Friday's edition of Chopper's Politics, Mr Khan warned about the "unintended consequences" of imposing such a tax on people who might be "equity rich, but cash poor".
While he accepted that those "with the broadest shoulders" should pay more, he said: "We have always got to be careful about the unintended consequences of hypothetical tax increases.
"I'm quite cognisant of the fact that it's not me that creates the wealth and prosperity in our city, it is the small businesses - those who are innovators, those who are chief executives of big companies.
"I'm not competing against Manchester, Liverpool, Edinburgh and Glasgow. I am competing against Paris, Singapore, New York, Hong Kong. What I don't want is flight out of London to those global competitors.
"That's why it's so important for our Chancellor at the moment, Rishi Sunak, to bat for our city. He needs to understand that we need equivalence to make sure we don't have flight to Dublin, Paris, Madrid, elsewhere in Europe, Frankfurt."
‘Levelling up should not mean dragging down London’
Mr Khan said he had personally warned Mr Johnson, his predecessor as Mayor of London, that a new white paper on levelling up - due to be published by the middle of next month - must not back policies to damage the South East.
Pointing out that London contributed a net £40 billion to the UK economy, he said: "The point I made to the Prime Minister was the way to make our country more equal is not to make London poorer. Levelling up should not mean dragging down London.
"Michael Gove, who represents Surrey, understands the contribution made by London and the South East. He understands that his constituents come into London on a daily basis, work their socks off to contribute to the national economy through London.
"You do not get a national recovery. You do not get wealth and prosperity created by dragging London down. We do not want to go back to the 70s and the 80s."
Bid to get more people back to the office
Mr Khan pledged that there will be no more lockdowns this Christmas due to Covid cases, despite fresh restrictions sweeping continental Europe.
He wants to see more people back in offices on weekdays to support local businesses in the capital.
He said: "We're getting more people back. Unfortunately, what we're seeing is an increase on Tuesdays, Wednesdays and Thursdays, not so much on Mondays and Fridays.”
He added that it is important to make the experience of coming back to the office “better than the one at home, because we're competing with people working from home on teams or Zoom, eating at home”.
Mr Khan continued: "There will not be a lockdown. It's unforeseeable at the moment in relation to this Christmas.
"People are desperate for a decent Christmas, but also it's really important we get the fruits of the vaccine roll out."
Mr Khan is leading a push to persuade more people to return to the office. He is currently in talks with Grant Shapps, the Transport Secretary, about new powers to force people to wear face masks on the London Underground or face fines.
Sadiq Khan would like to bring in new powers to ensure people wear face masks on the London Underground
Sadiq Khan would like to bring in new powers to ensure people wear face masks on the London Underground CREDIT: Kirsty O'Connor/PA Wire
British Transport Police lost powers to fine people for not wearing masks last July, when most lockdown restrictions were lifted in England.
"We're trying to persuade Grant Shapps to allow us to pass a bylaw, which would mean we can bring it in,” said Mr Khan. “Like there is a bylaw that you can't drink on the Underground. We think it's important.
"It will give people confidence and keep the virus down, but also - as we have increased footfall as we get into winter - Christmas shopping, the January sales, great events taking place in the theatre - we want more people coming back."
Transport services may have to be cut without a deal
Mr Khan is in talks with the Government about a £1.7 billion financial package for Transport for London (TfL) over the next two years.
He warned: "Unless we get a new deal from the Government on December 11, almost immediately we will have to start making tough decisions, probably in January."
He said that it would lead to the type of "managed decline" that Londoners might remember from the 1970s, adding: "It will mean jobs being lost around the country as well, because TfL is a transport body that relies upon factories across the country doing great work."
Mr Khan has ordered a review of statues and other monuments in London and said he wanted to see more memorials to women, black and disabled people.
He said: "We've got 11 statues of blokes in Parliament Square. We've now finally got a statue of a woman. Is that a culture war or is that me trying to better reflect the diversity of our society?
"I think women have played a great role in the history of our city and our country. Where can you see them? Similarly, disabled people have played a great role in our city. People of colour. Where can you see them?"
A new commission for diversity in the public realm is working "with councils, working with landowners, working with experts to see where we can have more diversity", he said.
Mr Khan added: "People shouldn't feel threatened by this at all. I think we should celebrate the huge contribution made over successive generations by people from different backgrounds."
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